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Families struggling with their finances in the run-up to Christmas have been warned to steer clear of illegal loan sharks.

Dodgy lenders are particularly active during the festive season as they target parents who are short of money but desperate not to let their kids go without.  They often charge extortionate rates of interest and threaten those that can’t pay with violence.

With so many legitimate and safer alternatives available, including secured loans and payday loans, the Government are clamping down on those who prey on the vulnerable.

Consumer Minister Gareth Thomas said: "Let the unscrupulous and predatory illegal lenders be warned. If they try to draw families into the murky world of illegal money lending this Christmas, they will face investigation and prosecution by anti-loan shark teams."

As the credit crunch firmly takes hold, house prices have been plummeting and first-time buys in the UK are lower than they have been for a long, long time.

But don’t get too down in the dumps about the whole situation because it’s not all doom and gloom! 

In fact, a lot of people are cottoning onto the fact that, in order to raise some extra cash, it’s now cheaper to get a secured loan than it is to remortgage your property.

An accepted.co.uk spokesman commented on the situation, saying, “Traditionally the remortgage has been the cheaper option but that’s just not the case at the moment, and we’re seeing a lot of people starting to take advantage of the great rates available.”

With everyone in the finance industry beginning to tighten their belts as the credit crunch starts to bite, it's never been more important to take care of your credit rating.

According to The Independent, the big credit reference agencies are preaching the importance of making sure you keep up to date with repayments on loans and mortgages, with Experian saying, "Whenever you apply for credit, you want to make yourself look more attractive to banks.  They are still lending money but they are only lending to people they can be sure will pay it back."

So make sure you pay back not only your loan repayments, but also things like your utility bills and your mobile phone bill; it all counts!

The price of petrol is finally falling but people all over the UK are still struggling to balance their books.

With Christmas on the horizon it’s going to be even harder to pay the bills and the loans market is starting to see the effects of all this financial hardship. 

In fact, more people than ever before are applying for loans, which is why a whopping 1.5 million have seen their loan applications turned down by various money lenders in the last six months.

But panic not. As we talked about last week, the lenders are still lending their dough; they’re just being a little pickier about who they give it to.

The Credit Crunch is really hitting home and the UK loans industry is feeling the effects too, meaning it’s harder than it has been for a long time to get a secured loan.

Talking exclusively to accepted.co.uk, one lender said, “The Credit Crunch has affected the availability of new finance for many lenders, which has increased loan rates in real terms to the customers.

“However, the equity in people’s houses still represents valuable collateral and lenders are still keen to provide good value finance for homeowners with sufficient equity.”

So there you go, straight from the horse’s mouth; the loans are still available, you might just need to look a bit harder.